We also talk about price change and earnings estimate revisions, two of the main aspects of the Momentum Style Score. The Zacks Momentum Style Score, part of the Zacks Style Scores, helps address this issue for us.īelow, we take a look at Dropbox (DBX), a company that currently holds a Momentum Style Score of B.
There is a lot of debate surrounding which metrics are the best to focus on and which are poor quality indicators of future performance. While many investors like to look for momentum in stocks, this can be very tough to define. The goal is that once a stock heads down a fixed path, it will lead to timely and profitable trades. In the 'long' context, investors will be essentially be "buying high, but hoping to sell even higher." With this methodology, taking advantage of trends in a stock's price is key once a stock establishes a course, it is more than likely to continue moving that way. Momentum investing revolves around the idea of following a stock's recent trend in either direction.
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